Dariusz Kowalczyk, Chief Invst Strategist at CFC Seymour says the comments by the  Fed Vice Chairman and the Fed Beige Book of an expected rate cut in December helped the Asian markets to rally.

He further adds that although the rate cut might not help theUS economy in the long-term, it just shows that Fed will continue to anything that is necessary to prop up the US economic machine.

Excerpts from CNBC-TV18's exclusive interview with Dariusz Kowalczyk

Q: Is it the expectation of a rate cut that is riding all the indices?

A: Yes clearly so because there is no other information that hit the market yesterday in a favourable way. It was just comments from Vice Chairman of the Fed, Donald Kohn as well as the Fed Beige Book which clearly showed that the economy is slowing and that the Fed is noticing that and that they are planning to counter that by a December rate cuts because until yesterday many Fed speakers suggested they were not prepared to easy policy. Now the market is really cheering the support the economy is going to get from the Central Bank.

Q: Do you expect rate cut to act as an effective since we have had two rate cuts since mid-September but they don’t seem to be having much of an long-term impact although short-term maybe?

A: It is true. The 50-25 bps lower cost of financing is not going to help the economy but it is sending a message that the Fed will continue to do anything that is necessary to prop up the consumer, to prop up the entire US economic machine.

It is difficult to actually assess what is going to be next year but this a kind of insurance policy that the market has, that the Fed will help us and that’s is why the risk of a slowdown seems to be much more mitigated right now that we know that policy makers are on our side.